It was an evening that confirmed stereotypes and resisted categorisation: more than 1,600 members of Brooklyn's Park Slope Food Coop, one of the oldest and largest co-operative markets in the US, gathered last night to vote on whether to hold a referendum on banning goods from Israel.

Put another way: a members-only grocery store held a vote on whether to hold a vote. In the end, members overwhelmingly voted against holding a referendum, meaning the co-op will not ban the sale of a handful of Israeli goods such as Sabra hummus, vegan marshmallows and a popular drinks carbonation system.

Rather mundane news in itself. But the 39-year-old co-op is a cultural touchstone in Brooklyn: a rich source of affordable organic produce for its 16,300 members, and a rich source of earnest hippies to ridicule for non-members. In recent months, the simmering politics of the Middle East, combined with the simmering seriousness of many co-op members, have fuelled tremendous tension in the community, even leading prominent New York politicians to weigh in on the proposed boycott.

"Why any of this has anything to do with selling food, I don't know," New York mayor Michael Bloomberg said at a news conference before the vote.

Of course, the food we choose to eat has always had political undertones, from Upton Sinclair's day to Fast Food Nation. (It also didn't hurt publicity that approximately 87% of New York's working journalists live in Park Slope – your correspondent, a co-op member in good standing for nearly a decade, included.) The meeting itself was, amazingly, a momentary trending topic on Twitter.

Things got off to a start 45 minutes after the scheduled 7pm kickoff. Hundreds of people were still queuing up outside Brooklyn technical high school, where the meeting was held. "I bet this many people won't come to the 40th anniversary party next year," joked one co-op staffer.

Pamphleteers, protesters and reporters combed the sidewalk, where a diverse queue stretched around the brownstone-lined block. Among them was Jessica Rodriguez, 28, who had come out in support of the boycott. "I feel it's a human rights issue," she said. "Israeli goods are based on the exploitation of Palestinian people."

The boycott she was rooting for is part of an international movement called Boycott, Divestment and Sanctions (BDS), which is trying to force the Israeli government to change its policies toward Palestinians.

But many in the audience felt the co-op was no place to hold a foreign policy debate. "I don't approve of all of Israel's policies, but I don't approve of a lot of policies of other countries whose stuff we sell," said a very pregnant Robyn Lazara, pointing to the fact that the co-op sells goods from China, which itself has a complicated relationship with human rights.

Carl Arnold, chair of the board of directors, called the meeting to order with a plea for "no demagoguery. But be as passionate as you want."

There was no shortage of either. The pro-BDS lobby played a video by Palestinian Queers for BDS called It Is Your Business. They made an eloquent appeal to the common humanity of all people, and pointed out that BDS has the support of the bishop Desmond Tutu and Brian Eno.

When the floor was thrown open to the audience, members took turns making comments that ranged from passionate to goofy, from endearing to inflammatory to completely deranged. The crowd was repeatedly told not to clap, but did so anyway. Those who didn't waggled their fingers in a silent Occupy-Wall-Street-style show of solidarity.

Some highlights:

• One self-identified Israeli woman said: "It fills my heart with happiness to see two thousand people who want to see peace in Israel and Palestine … But this feels like a call to war." Another man cannily read anti-BDS quotes from Noam Chomsky.

• Joe Holtz, a co-op founder and the current general manager, reminded people that the original spirit of the co-op was about togetherness, not political debate. "It's so clear that this is ripping people apart," he said.

• Others said that confronting that tension was a necessary challenge. The man who put it most colourfully said: "This doesn't feel good right now, but neither does an enema. We need to clean house." Uhhh …

• "Belonging to the co-op means belonging to justice. And injustice anywhere is an attack on justice everywhere," said one young woman, who never quite made it clear which way she was leaning. A midwife announced that she had delivered babies on both sides of this argument, and that "peace on earth begins at birth".

• In one particularly tense moment, a member's assertion that Israel engages in ethnic cleansing drew irate shouts and hisses from pro-Israel audience members, who were in turn shushed.

• One young man announced that he loves hummus so much that he has a CD about it. Also in the musical spirit, one young lady quoted the Beastie Boys, saying she would rather be fighting for her "right to party".

• "I would like to thank the BDS people for introducing me to the Israeli products," said one woman, who went on to sing the praises of the vegan marshmallows.

After about two hours of debate, the crowd voted on paper ballots – final tally: 1,005 votes against a referendum to 653 in favour – and began filing out of the auditorium.

But the general meeting had other items on its agenda. A woman got on stage to present a video on an unrelated topic. "I've never had an audience this big before!" she beamed, as hundreds of people streamed out into the brisk Brooklyn night.